NAPCC triggered the REC Mechanism in India

As per the IPCC fourth assessment report on climate change, situation is getting worst as time moving ahead. Through the direct observations of changes in temperature, sea level and snow cover in the northern hemisphere during 1850 to the present, it can be concluded that the warming of the Earth’s climate system is real. Global energy consumption has also considerable contribution to the GHG emission. Burning of fuel into the power station, Industrial uses and vehicles alone contributes great share in the emission of GHG’s.We have developed our efficiency in the fields of energy management but half of the energy created since industrial revolution has been consumed in the last two decades. According to the World Energy Outlook (International Energy Agency, “World Energy Outlook” 2006) published by the International Energy Agency (IEA), the world’s total net electricity consumption will increase dramatically in near future. The world electricity generation was 14,781 billion kWh in 2003 and will increase to 21,699 and 30,116 billion kWh in 2015 and 2030, respectively, which means a 2.7% average annual increase rate.

To participate with the rest of the world in combating climate change, India launchedNational Action Plan on Climate change. Respective to the energy consumption and its contribution in the GHG emissions, NAPCC has set the target of 5%renewable energy purchase for FY 2009 -10 (Electricity Act 2003 and the National Tariff Policy 2006: the central and the state electricity regulatory commissions must purchase a certain percentage of grid-based power from renewable sources). There is also a provision to increases such target by 1% for next 10 years i.e. approximately 4000 MW per annum of renewable energy capacity should be installed in subsequent years. This would mean NAPCC envisages renewable energy to constitute approximate 15% of the energy mix of India (Thermal sector has highest contribution in Indian power generation followed by large hydro based power projects. To achieve the target set by the EA-2003 and NAPCC, India launched REC mechanism. One REC is created when one megawatt hour of electricity is generated from an eligible renewable energy resource. (Read more on REC)

Presently Renewable Energy contributes approximate 8% of power generation as compared to thermal (64%). There is huge potential in Renewable energy generation but due to high cost involved, it is still a second option to the developers Indian Electricity Scenario).